TRYP'S SHOT IN THE ARM AS VALLEY HOTEL SELLS FOR $20M
Written on the 12 January 2016
WYNDHAM Hotel Group is poised to launch a new wave of TRYP hotels, after investors snapped up the art-inspired property in Brisbane for $20 million.
The accommodation provider and owner Jay McPhee placed the flagship hotel on the market in August last year to focus on replicating the brand across Australia.
Sydney-based Aligned Funds Management acquired TRYP Fortitude Valley on behalf of a client in the firm's fifth hotel acquisition since late 2014.
Aligned Funds executive director Glen Boultwood says after examining the local hotel market he noticed lower demand on weekends.
"In order to get comfortable with investing in the Brisbane hotel market, especially given the forecast future supply, it was imperative that any hotel could generate strong weekend demand to enable it to outperform the broader hotel market from both an occupancy and rate perspective," Boultwood says.
"The TRYP hotel has a proven track record in this regard. While there are other boutique hotels located in Fortitude Valley, the design of TRYP is unique and we believe it has the potential to become a destination hotel."
TRYP Fortitude Valley was acquired on a yield of 7.8 per cent, and Boultwood says the firm's client is looking for similar opportunities.
"We have delivered an annual ungeared return of over 17 per cent during the first 12 months of this mandate despite having to absorb acquisition costs," he says.
"In today's market it is important to retain discipline when looking at acquisitions to ensure that rather than just following the market we can extract real value for our clients."
The marketing campaign managed by Wayne Bunz and Rob Cross, of CBRE Hotels, attracted strong buyer interest with 211 enquiries.
"The unique design of the hotel, coupled with its exceptional location among key demand generators and strong food and beverage venues underpinned buyer interest," Cross says.
The 65-room hotel features a library-themed meeting room and dining outlets, including rooftop bar Up on Constance and award-winning chef Warren Turnbull's offering Chur Burger.
Each floor displays the work of renowned street artists combined with elements of Brisbane's unique heritage.
Wyndham's growth strategy includes key locations such as Sydney, Melbourne, Perth, Adelaide and the Gold Coast.